& cplSiteName &

Iliad Offers $15B for a Stake in T-Mobile

Dan Jones
7/31/2014
50%
50%

French operator Iliad has made a brazen $15 billion bid to scupper the long-rumored Sprint-T-Mobile US merger this Thursday and to try and get a 56.6% stake in the "uncarrier" for itself.

Iliad (Euronext: ILD) is initially offering $15 billion in cash for the majority stake, which would value T-Mobile US Inc. 's stock at $33. Further to that, the French operator says it values the remaining 43.4% of T-Mobile US stock at $40.5 per share.

This would give shareholders an overall value of $36.2 per share. T-Mobile's shares opened at $31.02 on Thursday.

"The US mobile market is large and attractive," Iliad said in a statement. "T-Mobile US has successfully established a disruptive position, which in many ways, is similar to the one Iliad has built in France."

At first sight, the bid looks akin to a minnow trying to swallow a guppy. T-Mobile's current market cap is $24.84 billion, while Iliad's stands at $16 billion.


Read up on T-Mobile's Q2 earnings here.


Nonetheless, Iliad says that it will finance its cash bid through a combination of debt and equity and has the support of international banks to raise acquisition debt money.

Whatever happens, an Iliad bid puts more heat on a oft-rumored $32 billion hook-up between Sprint Corp. (NYSE: S) and T-Mobile US. Any potential merger between the number three and four US wireless operators would always face intense security by government authorities as well. (See Sprint, T-Mobile Settle on $32B Price.)

"This transaction should not raise any antitrust issue in light of the competition rules given that Iliad is not present in the United States," Iliad writes of its bold bid.

T-Mobile's shares are now trading up around 5.82% at $32.74.

— Dan Jones, Mobile Editor, Light Reading

(7)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
briandnewby
50%
50%
briandnewby,
User Rank: Light Sabre
7/31/2014 | 9:55:53 PM
Re: Start of a bidding war?
We often talk of a Sprint/T-Mobile relationship, but couldn't Softbank all along place an offer on T-Mobile?  Why couldn't Softbank do this on its own, much like it did with Sprint, and thus begin investing in multiple carriers without operating them (for now).

I'm sure I have an investment in all four major carriers (through 401k funds :-) ) and I didn't need special approval.

Still, you get my point--it seems like Softbank is hamstrung because it has an equity interest in Sprint, or, maybe, the whole Sprint/T-Mobile discussion is chest puffing for a bigger play and there isn't a real intention at all for Sprint to merge with T-Mobile.
pcharles09
50%
50%
pcharles09,
User Rank: Light Beer
7/31/2014 | 7:53:48 PM
Re: Start of a bidding war?
@James_B_Crawshaw,

That's a good position to be in. It's also a position to aspire to be in.
James_B_Crawshaw
50%
50%
James_B_Crawshaw,
User Rank: Blogger
7/31/2014 | 5:01:32 PM
Re: Start of a bidding war?
Iliad's minority shareholders get nothing. Iliad's CEO (who owns 55%) gets to play Masayoshi Son for a while ...
ethertype
50%
50%
ethertype,
User Rank: Light Sabre
7/31/2014 | 4:54:01 PM
Why?
What on earth would Iliad gain from succeeding?  4th rank in a market they don't understand at all.  The opportunity to race Sprint to the bottom on price. Zero synergy. This makes no sense.

Given that, I have to agree with James B Crawshaw that it begs credulity as a serious offer, but when he says "this is just a stunt to get Sprint to make their offer earlier," I wonder why they would even care to do that?  Is there any sense in which Sprint and Iliad are competitors or Iliad would benefit by driving up Sprint's price?

C'mon, LR, when you see something this ridiculous, YOU should be asking these questions rather than accepting it at face value.
DanJones
50%
50%
DanJones,
User Rank: Blogger
7/31/2014 | 4:49:44 PM
Re: Start of a bidding war?
But what would Iliad gain from forcing Sprint's hand, I don't get that at all.
James_B_Crawshaw
50%
50%
James_B_Crawshaw,
User Rank: Blogger
7/31/2014 | 4:35:55 PM
Re: Start of a bidding war?
If Iliad seriously wanted to buy a 57% stake in T-Mobile US they would go to Deutsche Telekom (who owns 67%) not the board of T-Mobile US. This is just a stunt to get Sprint to make their offer earlier than anticipated. Quite what Iliad's minority shareholders get out of this I don't know. They can buy shares in US telcos on their own account if they wish. They don't need Iliad to do so. Seem's like M. Niel's ego has got the better of his rationality ...
DanJones
50%
50%
DanJones,
User Rank: Blogger
7/31/2014 | 2:57:30 PM
Start of a bidding war?
Is this the start of a bidding war? Legere mentioned "multiple" inorganic options for growth on the Q2 call. I assume he didn't just mean Cuban heels?
From The Founder
Download our complete guide to de-risking NFV deployment in 2016, including:
  • An eight-step strategy to deploying NFV safely, based on input from the companies that have already started virtualizing their production networks.
  • Interviews with leading executives at Colt, AT&T, Deutsche Telekom, Cisco, Nokia, ZTE, Ericsson and Heavy Reading.
  • Flash Poll
    Live Streaming Video
    Prepping for the Future: Upskill U Explained
    During this short kick-off video, Doug Webster, Vice President of Service Provider Marketing, Cisco, and Light Reading’s CEO & Founder Steve Saunders give an overview of Upskill U.
    LRTV Interviews
    AT&T Expert on the Key Pillars of UC

    4|29|16   |   03:58   |   (0) comments


    Vishy Gopalakrishnan, AVP of product marketing at AT&T, talks about the three developments that are making unified communications and collaboration secure and reliable for enterprise users.
    LRTV Documentaries
    LRTV Report: Mobile Core Innovation

    4|28|16   |   25:32   |   (0) comments


    Hear from multiple industry experts from Deutsche Telekom, SK Telecom, Heavy Reading, Huawei, Cisco, Ericsson, Nokia, NEC and many more about developments in the mobile core as operators virtualize their IMS and evolved packet core systems and prepare for a 5G world.
    LRTV Huawei Video Resource Center
    NFV World Congress Highlight

    4|26|16   |     |   (0) comments


    The highlight of the NFV World Congress contains exciting telecom news. Join us for an inside look at Huawei's ICT 2020 plan and its latest collaboration with industry leaders.
    LRTV Interviews
    Unified Comms Finds Its Voice

    4|25|16   |   03:44   |   (0) comments


    Peter Quinlan, VP of UCC Product Management at Tata Communications, talks about the evolution of the unified communications and collaboration services sector and how voice is now a big part of current developments.
    LRTV Documentaries
    So... What Do We Do Now?

    4|25|16   |   03:24   |   (0) comments


    After a long hiatus, Max Dingman, the CEO of a GeeGhiz, returns for a motivational board room pep talk.
    LRTV Documentaries
    NAB 2016 Highlights

    4|21|16   |     |   (0) comments


    Light Reading's Cable/Video Practice Leader Alan Breznick climbs down from the slots to tell us about the latest news in broadcast technology at NAB 2016 in Las Vegas.
    Between the CEOs
    CEO Chat: Deepfield's Craig Labovitz

    4|21|16   |     |   (0) comments


    In this latest installment of the CEO Chat series, Craig Labovitz, co-founder and CEO of Deepfield, sits down with Light Reading's Steve Saunders in Light Reading's New York City office to discuss how Deepfield fits in with the big data trend and more.
    Shades of Ray
    Leading Lights 2016: Shortlists Announced

    4|20|16   |   0:53   |   (0) comments


    The judging is over and the Leading Lights 2016 shortlists have been published -- you can see who made the cut by clicking on this link.
    LRTV Custom TV
    Introducing MulteFire – Qualcomm at MWC 2016

    4|18|16   |   3.29   |   (0) comments


    MulteFire is the latest option for using LTE in unlicensed spectrum. As oppose to its close 'siblings', LAA and LTE-U, MulteFire operates solely in unlicensed spectrum, which enables it to offer the best of two worlds – LTE-like performance with WiFi-like deployment simplicity. In this interview, Sanjeev Athalye, Sr. Director, Product Management at Qualcomm ...
    Between the CEOs
    CEO Chat: Grant Van Rooyen of Cologix

    4|18|16   |     |   (0) comments


    Grant van Rooyen, president and CEO of Cologix, sits down with Steve Saunders, founder and CEO of Light Reading, in the vendor's New Jersey facility to offer an inside look at the company's success story and discuss the importance of security in the telecom industry.
    LRTV Huawei Video Resource Center
    ONS 2016 – Demonstration of Huawei's NetMatrix Multi-Vendor SDN Orchestrator

    4|15|16   |     |   (0) comments


    This demonstration shows how Huawei's NetMatrix SDN Orchestrator (SDN-O) addresses an operator's core service agility needs for services spanning multi-domain, multivendor networks: it includes a demonstration of:
    - Rapid New Service Design: using YANG to model a complex example of multi-domain, multivendor L3VPN network connectivity service that ...
    LRTV Custom TV
    AT&T Wants to Own North Carolina

    4|15|16   |     |   (1) comment


    Venessa Harrison, president of North Carolina for AT&T, tells how the company will expand its GigaPower service beyond the seven N.C. cities it already serves.

  • This blog, sponsored by AT&T, is the second part of a ten-part series examining next-generation broadband technologies titled "Behind the Speeds."
  • Upcoming Live Events
    May 23, 2016, Austin, TX
    May 23, 2016, Austin Convention Center
    May 24-25, 2016, Austin Convention Center, Austin, TX
    September 13-14, 2016, The Curtis Hotel, Denver, CO
    December 6-8, 2016,
    June 16-18, 2017, Austin Convention Center, Austin, TX
    All Upcoming Live Events
    Infographics
    A new survey conducted by Heavy Reading and TM Forum shows that CSPs around the world see the move to digital operations as a necessary part of their overall virtualization strategies.
    Hot Topics
    Ultra-Broadband Summit, Hong Kong
    Iain Morris, News Editor, 4/27/2016
    WiCipedia: Woman Cards & Bitch Switches
    Sarah Thomas, Director, Women in Comms, 4/29/2016
    Mitel Asks: What Time of Day Do You Shower?
    Mitch Wagner, West Coast Bureau Chief, Light Reading, 4/25/2016
    GoT Fans Curse HBO (Not Right) Now
    Mari Silbey, Senior Editor, Cable/Video, 4/25/2016
    LoRa Alliance Defends Tech Against Sigfox Slur
    Iain Morris, News Editor, 4/28/2016
    Like Us on Facebook
    Twitter Feed
    BETWEEN THE CEOs - Executive Interviews
    In this latest installment of the CEO Chat series, Craig Labovitz, co-founder and CEO of Deepfield, sits down with Light Reading's Steve Saunders in Light Reading's New York City office to discuss how Deepfield fits in with the big data trend and more.
    Grant van Rooyen, president and CEO of Cologix, sits down with Steve Saunders, founder and CEO of Light Reading, in the vendor's New Jersey facility to offer an inside look at the company's success story and discuss the importance of security in the telecom industry.
    Animals with Phones
    Live Digital Audio

    Of all the tech companies in the Valley, Intel has made the most aggressive commitment to building a diverse and inclusive workplace culture. It's doing so by taking concrete, measurable steps, making a large financial investment and through a commitment to complete transparency about its progress. In this radio show, WiC Director Sarah Thomas will be joined by Shlomit Weiss, Intel's Vice President, Data Center Group, and General Manager of Networking Engineering, who will share with us why Intel is tackling this huge challenge, how and to what effect. She will also discuss her unique experiences leading development of Client SOC development in the past and today leading development of all of the chipmaker's silicon hardware for networking IPs and discrete devices and managing a team of 600 engineers across Israel, Europe and the US.